By Guy Faulconbridge
MOSCOW (Reuters) – A group of pro-Ukrainian scholars has called for much tougher Western sanctions on Russia, including halving an oil price cap to $30 a barrel, imposing a full embargo on Russian steel, iron and diamonds and making it easier to confiscate Russian assets.
The International Working Group on Russian Sanctions, which includes around 40 scholars including Stanford University’s Michael McFaul, a former U.S. ambassador to Russia, said tighter sanctions would reduce Russia’s ability to fight in Ukraine.
“The only way to stop the ongoing killing, suffering, and economic destruction is to defeat the Russian military and force Russian soldiers to withdraw from Ukraine’s sovereign territory,” the group said in a 33-page note dated April 24.
The group says it coordinates and consults with the Ukrainian government but does not take direction from Kyiv, which has long called for tougher sanctions on Moscow.
President Vladimir Putin says the West’s attempts to undermine Russia’s economy amount to economic war, but have failed to cause serious harm. Moscow has redirected exports, especially oil it once sold in Europe, to new customers in Asia.
In the report, entitled “Action Plan 2.0 – Strengthening Sanctions against the Russian Federation”, the scholars said Russia’s energy sector should be the main target.
In December major economies imposed a $60-per-barrell global price cap on Russian oil transported by sea. Those calling for tougher measures say the impact was limited because the cap is close to the market price. Moscow calls the price cap illegal.
“We see further energy sanctions as key to constraining its war-making capability, especially because the G7 has recently decided against lowering the price cap,” the group said.
It called for the cap to be lowered to $45 a barrel immediately, with a goal of cutting it further to $30 – around what it estimates to be Russia’s marginal production cost.
The cap should be enforced more stringently, and an import tax on Russian oil and gas be imposed, it said. Japan, Taiwan and South Korea should impose an embargo on Russian energy in East Asia.
The West should impose full sanctions on big Russian energy firms including Gazprom, Gazpromneft, Rosneft, Surgutneftegaz, Lukoil, Tatneft, Transneft, Sibur , Zarubezhneft and Novatek, the group said.
Any Western oil and gas companies remaining in Russia should face a 100% tax on benefits derived from their Russian operations, while Western oil field services should be blocked for Russia.
The West should impose an embargo on all Russian iron and steel as well as its diamonds and jewelry, the group said, while tougher sanctions should be imposed on all major Russian banks. Deadlines should be set for remaining foreign banks to leave.
The group called for easier confiscation of Russian private and state assets across the world.
(Reporting by Guy Faulconbridge)
